The Progress Report on Serbia is part of the 2013 Enlargement Package adopted by the European Commission on 16 October. 2013 was a historic year for relations between the EU and Serbia with the decision to open accession negotiations on 28 June and the entry into force of the Stabilisation and Association Agreement (SAA) on 1 September.

The Commission concluded that Serbia sufficiently fulfils the political criteria. Continued visible and sustainable progress in the normalisation of relations with Kosovo1*, including the implementation of agreements reached so far, will remain essential. Serbia will also have to sustain over time the reform momentum in the key areas of the rule of law, particularly judicial reform and anti-corruption policy, independence of key institutions, media freedom, anti-discrimination policy, protection of minorities and business environment.

Political criteria

Serbia sufficiently fulfils the political criteria. It has reinvigorated the momentum of reforms and has stepped up high-level contacts with neighbouring countries in an effort to make a positive contribution to regional cooperation. The government and the parliament have applied enhanced rules for the consultation of stakeholders on legislation and policies. Key and comprehensive strategies and action plans have been adopted in the areas of judiciary, fight against corruption and anti-discrimination. An action plan for the implementation of the national strategy for the improvement of the status of the Roma was adopted in June. As regards freedom of expression, defamation was decriminalised. Serbia also continued to fully cooperate with the International Criminal Tribunal for the Former Yugoslavia (ICTY).

Serbia has taken significant steps towards a visible and sustainable improvement of relations with Kosovo. Its engagement in the EU-facilitated dialogue resulted in April in a landmark "First agreement of principles governing the normalisation of relations", complemented in May by a comprehensive implementation plan. This represents a fundamental change in the relations between the two sides. Serbia needs to remain fully committed to the timely implementation of the “First Agreement” and its implementation plan, together with other agreements reached in the dialogue. It is important that Serbia continues to encourage wide participation of Kosovo Serbs in the forthcoming local elections in Kosovo.

Serbia still has to pay particular attention to the independence of key institutions, notably the judiciary. The effective implementation of the strategies and action plans in the fields of judiciary and anti-corruption will test Serbia's preparedness and willingness to move forward. Serbia’s track record in effectively investigating, prosecuting and convicting perpetrators of corruption and organised crime remains to be seriously strengthened. An enhanced drive in public administration reform is needed. Serbia needs now to move forward the implementation of the media strategy starting with the adoption of the expected legislation on public information and the media, on public service broadcasters and on electronic communications.

While some additional efforts were made by the authorities and independent institutions on the protection of other vulnerable groups, in particular of the lesbian, gay, bisexual, transgender and inter-sex (LGBTI) population, sufficient political support is still lacking in this area. It was in particular regrettable that the pride parade had to be cancelled for the third year in a row on security grounds; this was a missed opportunity to show respect for fundamental rights. Further attention is to be given to actively protect media, human right defenders and other vulnerable groups, including LGBTI population, from threats and attacks from radical groups. Recent progress in improving the situation of minorities, including the Roma, needs to be further built up including with additional financial resources. Consistent implementation of the legal framework on the protection of minorities throughout Serbia remains to be fully ensured, notably in the areas of education, use of language, and access to media and religious services in minority language.

Economic criteria

In 2012, Serbia went through another recession and the economy contracted by 1.7%. The economy slightly recovered in the first half of 2013. High exports growth has softened the effects of depressed domestic demand. Fiscal consolidation efforts were taken mostly on the revenue side. The process of restructuring state-owned enterprises was revived. Some progress has been made with regard to fighting corruption and improving property rights.

Serbia needs to make significant efforts in restructuring its economy so as to cope in the medium-term with the competitive pressures and market forces within the Union. State presence in the economy is significant and state-owned companies continued to accumulate big losses. Serbia needs to continue improving the business environment and should make strong efforts to develop a competitive private sector. The functioning of market mechanisms is hampered by legal uncertainty and corruption. The informal sector remains an important challenge.

EU legislation

Serbia continued to focus on aligning with the EU legislation, an effort which is underpinned by an updated National Plan for the Adoption of the Acquis.Good progress was made in public procurement with the adoption of a new Law on Public Procurement The issue of the Central Bank’s independence has been partially addressed with amendments to the law. Two new laws were adopted in the fields of corporate accounting and auditing, aiming at further alignment in the area of company law. The institutional framework for SME policy and SMEs access to finance improved. Measures taken to improve the business environment, in particular on the business impact assessment for new legislation, are a welcome development.

It will be important that Serbia redoubles its efforts to align with the EU legislation with particular attention to the effective implementation of adopted legislation. Serbia will need to intensify efforts towards the alignment and implementation of the acquis in the fields of environment and in the energy sector. Further efforts are also needed in the areas of state aid control. The GMO law needs to be aligned with EU legislation to enable WTO accession. Substantial efforts are needed to develop public-sector financial management and external audit capacity.

The Interim Agreement (IA) of the Stabilisation and Association Agreement (SAA) continued to be smoothly implemented. An agreement has been reached on the adaptation of the trade provisions of the SAA in order to take into account Croatia's accession to the EU and with a view to maintaining traditional trade flows.

Key Dates

1999: The EU proposes the new Stabilisation and Association Process for five countries of Southeast Europe

June 2000: The European Council states that all the Stabilisation and Association countries are potential candidates for EU membership

June 2003: Thessaloniki Summit: EU perspective for the Western Balkans is confirmed

April 2008: Signing of the Stabilisation and Association Agreement (SAA) between Serbia and the EU

December 2009: Visa-free travel to Schengen area for citizens of Serbia; Serbia presents its application for membership of the EU

February 2010: The Interim Agreement on Trade and Trade-related issues (part of the SAA) enters into force

October 2011: The European Commission issues its Opinion on Serbia's application for EU membership

March 2012: Serbia obtains the status of candidate country

April 2013: The European Commission recommends the opening of accession negotiations with Serbia

June 2013: The European Council decides to open accession negotiations with Serbia

September 2013: The SAA enters into force; the analytical examination of the acquis (“screening”) starts.